The word “Bitcoins” has been going around a lot lately. But, what does it really mean? How does it work? And most importantly, how can we use it to safe keep our finances safe?
What is Bitcoin?
Currency or money as it is called in the general peer-to Peer computer network that makes up the Internet. It is actually a highly complex algorithm and every transaction that goes through in the peer-to Peer computer network is accounted for and all of it is tracked on the global ledger known as the World Wide Web. It is this total amount of transactions that is called the” bitcoins”, or the” Bitcoins Balance”.
Bitcoins are actually” cryptocoin”, which is short for” Cryptocurrency”. This term actually was created by an IT student from Canada, which is also the person behind the original website that launched the concept of a cryptography project that would eventually become Bitcoin. The main goal of the project was to try and create a new kind of payment system that could be used anywhere in the world, with anyone who had access to the internet. The problem was that this system needed to have something that was private and safe from any unauthorized transaction, both in public and between private keys.
The solution to this problem came from the mixing of two technologies known as Cryptocurrency and a robust central authority. By combining the two, the whole idea became possible to function as a worldwide currency and accounting system that would never be limited or hacked, with every transaction being accounted for in the public ledger. This is exactly how the Bitcoin protocol works.
As you can see from the graph above, the value of the Bitcoins in the past few months has gone up dramatically, from about $6.00 per coin on April 27th, to about $7.00 on May 5th, to over $8.00 on August 3rd. This sudden increase was mainly due to the fact that the cryptocoin market cap is increasing. The value of each unit of Bitcoins is increasing every day, but the number of transactions is still small, only consisting of about five hundred. This means that the average user will not see a significant change in their wallet balance.
Benefits of bitcoin
Another benefit of this system is that because it is based on proof-of-work technology, the network is secure and has very low fees for new transactions. A large number of business, governments and other types of institutions are starting to use this new way of doing things, along with ordinary citizens. This is because they benefit greatly from using Cheap Electricity. Even though there are many skeptics out there, the proof-of-work system has proven that it is secure and cheap electricity for individuals.
Because Nakamoto designed the protocol that is used to power the cryptocoin, there is no centralization or middlemen involved in any transactions. Individual transactions are free and allow users to create as many accounts as they need. As you add more account balances to your Cheap Electricity plan, you get more transaction fees per month. This is what makes Nakamoto’s protocol so desirable.
To be honest, I have not really followed the development of the cryptocoin. However, I have used it to generate my own income by conducting small home business sales on behalf of clients. Even if I do not follow the protocol that Nakamoto developed, I am happy that he has brought this great alternative to the world. If you want to start generating an income online, with this new currency you need not worry about having to pay an arm and a leg for each transaction that you conduct.
